OLBERMANN: Except, of course, letting the courts decide whether or not somebody goes to jail. What about a quid pro quo? Did the president or vice president tell Libby months ago he’d never go to jail no matter what they convicted him of? And did Mr. Cheney tell Mr. Bush to do this?

(BEGIN VIDEO CLIP)

TONY SNOW, WHITE HOUSE PRESS SECRETARY: I am sure the vice-president may have expressed an opinion, but the fact is the president understands the importance -- (INAUDIBLE) never recused himself. I honestly don’t know.

(END VIDEO CLIP)

OLBERMANN: The Democrats don’t know where to start. House Oversight wants to hear from special counsel Fitzgerald. House Judiciary schedules for next week may call Libby himself to the hearing. A new twist on why it was commutation and not a pardon. A pardon would have erased any chance Libby has of avoiding testifying further, especially if the vice president is prosecuted.

Also, the former vice president versus Rudy Giuliani over the right to watch the last episode of “The Sopranos” in advance. Mr. Gore wins, because he was willing to let them put a copy of the finale in a lockbox.

OLBERMANN: And a message to Mr. Bush and Mr. Cheney, simple to understand, in tonight’s special comment. Resign.

All that and more, now on COUNTDOWN.

Good evening.

The reporters who cover the White House, perhaps speaking for a clear majority of Americans who disagree with the president’s decision to commute Scooter Libby, including 40 percent of Republicans, when they told White House press secretary Tony Snow this morning, quote, “You are insulting our intelligence.”

Our fifth story on the COUNTDOWN, the day after the president threw away any reason for Americans to assume he is an honest man, or that the laws of the land will be applied fairly to all by he and his administration, and it brought absolutely no clarity and plenty of outrage.

Ahead in this newshour, my special comment.

But we begin tonight with the latest details. Most in the U.S. in firm disagreement with the president’s decision to let former White House aide Libby off the hook without ever having served a single day in prison or even finished his appeals process, 60 percent of those Americans asked in a new Survey USA poll saying Mr. Bush should have left Judge Reggie Walton’s decision to stand as was.

As we mentioned, that includes 40 percent of all Republicans, a plurality among the choices, wrapping up a visit to the Walter Reed Army Medical Center in Washington today, President Bush, in his only public comment so far, refusing to rule out a later full pardon for Mr. Libby in the future.

(BEGIN VIDEO CLIP)

BUSH: First of all, I had to make a very difficult decision. I weighed this decision carefully. I thought that the jury verdict should stand. I felt the punishment was severe. So I made a decision that would commute his sentence but leave in place a serious fine, proba—and probation. As to the future, I’m, you know, rule nothing in and nothing out.

OLBERMANN: The Libby commutation going against six-plus years of Bush administration precedent, this just the fourth commutation by this president, his Justice Department having pushed hard for federal sentencing guidelines, and for judges who enforce them no matter what any extenuating circumstances might be. And, of course, there is nothing more extenuating than actually knowing the convict yourself.

(BEGIN VIDEO CLIP)

BUSH: I took this decision very seriously on Mr. Libby. I considered his background, his service to the country, as well as the jury verdict. I felt like the jury verdict ought to stand. And I felt like some of the punishments that the judge determined were adequate should stand. But I felt like the 30-month sentencing was severe. And a judgment, a considered judgment, that I believe is the right decision to make in this case. And I stand by it.

Thank you all very much.

(END VIDEO CLIP)

OLBERMANN: White House press secretary Tony Snow probably wishing he could have walked out on this morning’s contentious Q and A session with reporters, heavy on the questions, short on answers of any real substance, in his statement last night, Mr. Bush having said that he believed the prison sentence given to Mr. Libby was excessive, this morning his spokesman adding that by excessive, Mr. Bush meant any jail time at all.

(BEGIN VIDEO CLIP)

SNOW: (INAUDIBLE) the president thought the jail time, in fact, was inappropriate. It, therefore, he decided to (INAUDIBLE).

SNOW: Well, he said it was excessive, and he thought that any jail time was excessive, and therefore, he did not see fit to have Scooter Libby taken to jail.

(END VIDEO CLIP)

OLBERMANN: And in the wake of last week’s “Washington Post” series on the vice president, which revealed that Dick Cheney sees to it that he is the last person to meet with Mr. Bush before Mr. Bush makes a final decision on big issues, there were those who wondered just how influential Mr. Cheney was in weighing in on this decision.

(BEGIN VIDEO CLIP)

SNOW: I’m sure that the vice president may have expressed an opinion, but fact is, the president understands the importance -- (INAUDIBLE) never recused himself. I honestly don’t know.

UNIDENTIFIED FEMALE: Did he ask for the president to spare his friend?

SNOW: You know, we never, as you know, Kelly, talk about internal deliberations. Nice try. I mean, we’re—this is, this is exactly what we’re talking about right now before the House and Senate. And we are not going to characterize specifically any kind of advice or plea that somebody may make.

UNIDENTIFIED FEMALE: The pubic deserves to know if the vice president asked the president to use his constitutional authority to spare his former aide and longtime friend from prison.

SNOW: Well, let me put it this way. The president does not look upon this as granting a favor to anyone. And to do that is to misconstrue the nature of the deliberations.

(END VIDEO CLIP)

OLBERMANN: Course, were not for the relationship between the vice president and Mr. Libby, it’s indisputable that the commutation never would have happened at all, because of the simple fact that Libby never requested it. Not so 3,000 others in this country in prison who have made similar requests. Is the president going to give all them the same measure, any measure, of his time and careful attention?

SNOW: Three thousand in jail (INAUDIBLE). I’m not sure that you could take anybody who has a perjury count and say that they’re all the same. Every count has to be considered differently. The president, the president, as you know, looks very carefully at these things. And furthermore, not every one of these cases comes before a president, as you’re well aware.

Attorneys quite often petition for these, and that’s one of the procedures by which they do it. But...

UNIDENTIFIED FEMALE: Can I follow on that? Is there—there are more than 3,000 current petitions for commutation, not pardons, but commutations, in the federal system under President Bush. Will all 3,000 of those be held to the same standard that the president applied to Scooter Libby?

SNOW: I don’t know.

(END VIDEO CLIP)

OLBERMANN: We know.

It’s time to call upon the analysis of our own Richard Wolffe, senior White House correspondent for “Newsweek” magazine.

OLBERMANN: This all seems fairly easy to understand, not anywhere near as complicated nor as nuanced as Tony Snow is trying to make it appear there. Has a tipping point been reached that has not defendable in any other way than saying, “Because I’m the president, and I wanted to do this”?

WOLFFE: Well, this is The Decider at work, and it does recall, I think, that infamous excuse of Bill Clinton when he said, “Because I could,” although it’s important to remember, of course, that had nothing to do with national security. And can you imagine the outcry if it had been?

What we’re seeing here is a president who is deciding something based on his personal feelings. He said it to me and to other reporters about how badly he felt for Scooter Libby’s family, and how that (INAUDIBLE) -- that was an important factor in how he looked at this whole thing.

Now, when he looked at hundreds of other cases down in Texas, the severity of the sentence, whether it about the death penalty or about drugs offenses played no role in shaping his view. And I think it’s very curious here, it raises a very fundamental question about how he can make a detached judgment about policy when he’s personally invested, not just about Scooter Libby, but obviously also about Iraq.

OLBERMANN: Something that one would assume would come up before the House Judiciary Committee, where Chairman Conyers says he will be conducting hearings about the commutation next week, Congressman Waxman and the Oversight Committee, they want to hear from the special prosecutor, Mr. Fitzgerald. Those poll numbers that I cited earlier, especially that number, 40 percent of Republicans, who believe Mr. Bush should have let the sentence stand, that’s an extraordinary number, again, it’s the number one choice of the three options among the Republicans.

Is it possible that the commutation might coalesce not just Congress into action, but also the American people?

WOLFFE: Well, those poll numbers are fascinating, and it does undercut a lot of what many commentators have been saying, many pundits, saying that this was all done because he wants to position himself and curry favor with the base. You know, White House officials say that wasn’t the case. I believe that. And look at the numbers, it doesn’t really help them.

Now, Conyers is talking about contempt of Congress action on the U.S. attorneys. I think you’re going to see a real legal showdown, not just on this subject, but on U.S. attorneys, on war powers, as we’ve discussed before.

And more broadly, really, if you look at 2006, the elections then, Democrats made gains on two things, Iraq and on this whole culture of corruption. And if you tie things together, whether it’s Abramoff or about this kind of thing or U.S. attorneys, it’s a very rich vein for Democrats to mine. That’s what we’re seeing with Hillary Clinton talking about cleaning up the White House, and Barack Obama talking about changing politics in America.

This does point a way forward for Democrats in next year’s elections.

OLBERMANN: Yes. The Scooter Libby legal case is extraordinarily complex. The Scooter Libby commutation is a lot more easily understood. Now, could this also wind up being seen as an more explicit example of a White House that simply does not care what others think, the surge being a more lethal example of the same thing?

WOLFFE: Yes, look, this is a personal decision for the president, and it was very tightly held. And I don’t really think that the greater impact of it was a factor. Now, of course, for the White House, that means he was being very principled about it.

But there’s a reason why presidents do this stuff as they walk out the door, because they know it doesn’t matter any more. This is a president who still has got to do some important things, whether you like him or not, whether you support him or not, he’s leading two wars right now, and he needs the support of the country to execute them or to end them.

So, you know, this is pretty shortsighted on his part. And he’s put his personal feelings about Scooter Libby above many other political goals he has for his administration.

OLBERMANN: The practicalities of this, Tony Snow said in that briefing this morning that the president spent many weeks consulting with senior members of his administration, presuming that some outcome like this was going to be presented to him. Do we have any idea how wide that circle of advisers really was?

WOLFFE: Yes, you know, I checked up on that today, and senior White House officials tell me there was wide consultation. But I’ve got to tell you, in my experience, that really means no more than about a half a dozen people. And when you have a consultation that doesn’t take in the career Justice Department folks who look at this kind of stuff, who could say, This was within the sentencing guidelines, it’s really not that wide a consultation.

In the end, this comes down to one man’s decision, and probably one man’s decision based on one man’s advice, which is obviously the vice president.

OLBERMANN: So when Mr. Snow said he—the vice president might have recused himself from this, we shouldn’t take that, that estimation from the press secretary too, too seriously?

WOLFFE: I have long said that the hardest relationship to get at inside this White House, even harder than Laura and George’s relationship, is Dick Cheney and the president’s. And those conversations happen with no one else in the room. I seriously doubt whether the vice president recuses himself from any subject.

OLBERMANN: Perhaps Barney took it down.

Our own Richard Wolffe, senior White House correspondent for “Newsweek” magazine. As always, Richard, great thanks for your time, great thanks for joining us.

OLBERMANN: The spin on this from the rabid right, there was no crime, why should anyone do time? We will truth-squad the talking points designed to exonerate Scooter Libby and thus, President Bush.

And tonight’s special comment. This is the week of the Fourth of July. We already decided once in this country at this time of year we would not abide rulers who made up their own laws. It is time to do that again.

You are watching COUNTDOWN on MSNBC.

(COMMERCIAL BREAK)

OLBERMANN: (on camera) an administration lies to take its country to war, and then lies about critics of that lie, and then lies to prosecutors about its lies about critics of that lie, it should come as no surprise that the president’s protection of those lies would be defended today with a fourth tier of lies.

In our fourth story tonight, the truth behind the pardon of the lies to shield the lies about the critics of the lies who sold the war.

In his written statement last night, Mr. Bush referred to critics of the investigation, a nice way of saying, friends of the convicted, arguing that no one, not even Scooter Libby, was actually charged with the crime that had spurred the investigation, namely, the leaking of Valerie Plame’s identity as a covert CIA operative, after her husband exposed administration lies about the war.

From the day Libby was charged, critics of the investigation also claimed that Plame never had any cover to blow. That lie persists despite increased proof otherwise. And today, new lies emerged about Mr. Libby’s sentence itself, and Mr. Bush’s, quote, “careful consideration of it.”

No journalist has a better handle on the truth in this manner than does our own David Shuster, who has covered the story from its beginnings.

OLBERMANN: We’ll get to the newborn fabrications in a bit. But if you would start with the red herring that even Mr. Bush cited, the lack of any other charges in this case.

SHUSTER: Yes, Patrick Fitzgerald said the day he indicted Scooter Libby, and again throughout this trial, that Libby had thrown sand in the eyes of the umpire, in other words, investigators could not make a call on the leaking of CIA operative Valerie Wilson, because Libby and others would not tell the truth.

That’s very different from saying there was no underlying crime, or that nothing happened. In fact, we know that something criminal happened, because the CIA referred the Wilson outing to the Justice Department for an investigation.

But the lies in this case kept Patrick Fitzgerald from charging anybody for the leak, or from getting a clear picture about Vice President Cheney. But the lies themselves under oath are crimes, as our justice system has long recognized.

OLBERMANN: And beyond being mere crimes, David, we forget—we tend to forget that there is meaning behind that phrase “obstruction of justice.” It means that you kept prosecutors from getting to the truth so you couldn’t file other charges.

The other part here, some of Libby’s defenders argued all along, and we heard it again, to the point of being deafened by it, yesterday and today, that there was no crime to investigate because Valerie Plame was not, in fact, covert.

SHUSTER: Yes, well, hopefully some of the Libby defenders will actually read some of the documents in this case someday, because just recently, in the argument over Libby’s sentence, Patrick Fitzgerald stated that Valerie Wilson was, in fact, covert, that the CIA had said she was covert, in other words, the elements were there to charge somebody with violating the Identities Protection Act, if Fitzgerald had gotten a good look at the disclosure.

Valerie Wilson was covert. She was a protected agent. And again, it’s another reason why the CIA, under George Tenet, asked the Department of Justice to investigate the administration officials who outed her.

OLBERMANN: Let’s move, as promised, to this post-commutation set of falsehoods. Mr. Bush said the prison time was excessive. Tony Snow said any prison time would have been excessive, both of them citing the probation board to back them up. That—was that just blunt dishonesty?

SHUSTER: Well, it certainly was not truthful or accurate, because, in fact, the probation board had recommended that Scooter Libby receive 16 months, not no jail time, but 16 months. Prosecutor Patrick Fitzgerald recommended 30 months. The only group that recommended probation or no jail time was Libby’s defense team. The judge that was appointed by President Bush agreed with Fitzgerald and said that based on the seriousness of the investigation that had been obstructed, and based on federal sentencing guidelines, Libby deserved 30 months.

Libby ask the appeals court to let him stay out pending appeal, and the appeals court, with one Democrat and two Republicans, ruled unanimously that the sentence was appropriate, and that Libby should not be allowed to stay out of prison pending appeal.

So the White House spin on what is excessive is both curious and factually incorrect, and again, it makes a lot of legal experts and political observers wonder if the president was really driven by the fear that Scooter Libby in a jail cell was a ticking time bomb for this administration.

OLBERMANN: One other point here. The Department of Justice guidance on obstruction of justice is what, no leniency, because you’re the guy who just stuck the tire iron in the wheels of justice?

SHUSTER: Yes, the obstruction of justice statute is considered one of the most serious under Justice Department guidelines. And what it does is, when you’re convicted of obstruction (INAUDIBLE) obstruction of justice, the justice system requires that a judge look at, Well, what was the overarching investigation about?

And the judge determined because, that because the overarching investigation was so serious, and because of obstruction of justice is so serious, and because obstruction of justice blocks somebody from knowing the truth in the overarching investigation, there are certain mandatory minimums, and based on that, the judge found, and the appeals court agreed, that the sentence for Scooter Libby of 30 months was entirely appropriate and was not excessive.

OLBERMANN: Well, as we saw again here in the spinning of this outcome, when the facts don’t match what you want them to say, change the facts.

Our own David Shuster. As always, great thanks for sticking to this case.

SHUSTER: Thanks, Keith.

OLBERMANN: Thanks for being with us.

And the ulterior motive. Why would a president who commuted almost no one as president, or even as governor, suddenly choose this route? To keep Libby from having to testify against, say, the vice president?

And after he was stupid enough to mess with the legal system and fire the Watergate special prosecutor, Richard Nixon eventually realized he had to resign for the good of the nation. Now, George Bush has messed with the legal system, and he needs to realize it too.

OLBERMANN: The president had commuted exactly four sentences in his first six and a half years in office. In capital cases, as governor of Texas, he had not commuted 152 out of 153 for whom the sentence was not prison but death. So why Scooter Libby? Was it less to keep him out of jail than it was to avoid getting him pardoned now, because pardoning him now might have forced Libby to testify against Dick Cheney?

That, and tonight’s special comment.

Plus, the current vice president gets to shoot people in the head and dictate war and ignore laws, but the former vice president got to see this in advance. And now, a Republican presidential candidate who is upset he didn’t get to see it in advance as well.

Ahead tonight on COUNTDOWN.

(COMMERCIAL BREAK)

OLBERMANN: If President Bush was actually seeking nuance, if his commutation of Scooter Libby’s 30-month prison sentence was somehow intended to mute criticism by refraining from an outright pardon, he badly miscalculated.

In our third story on the COUNTDOWN, why then did Mr. Bush not go ahead and grant Mr. Libby the actual pardon, as he hinted today he may yet do. Instead of the virtual one he so couched with an assertion he respects the jury’s verdict.

And how did a man so adverse generally to the notion of commutation find this one so appealing? As governor of Texas, Mr. Bush had little interest in exerting his legal authority even when it involved the ultimate punishment: execution, 152 of them were carried out in Texas during Mr. Bush’s six years as governor. More than under any other governor in recent history.

Mr. Bush granted fewer pardons than any Texas governor since the 1940s, 16 in total - just one in a death penalty situation. He wrote in his autobiography that he would not quote, “replace the verdict of a jury unless there are new facts or evidence of which a jury was unaware, or evidence that the trial was somehow unfair.”

But by yesterday’s accommodation, Mr. Bush replaced the sentence of a judge, who acted as pointed out by special prosecutor Fitzgerald consistently with the applicable laws and after extensive argument.

Let’s turn now to George Washington University law professor Jonathan Turley, a scholar of constitutional law. Jonathan, good evening.

JONATHAN TURLEY, GEORGE WASHINGTON UNIVERSITY: Hi, Keith.

OLBERMANN: Running theory today has been it’s a commutation, not a pardon now because with a pardon, Scooter Libby could not claim the Fifth Amendment against self incrimination in the event the vice president or anybody else would still be prosecuted.

But John Dean said here last night that with jail time no longer an issue, the special prosecutor could still immunize Libby in such a situation and still force his testimony. Straighten this out for us.

TURLEY: Well John is correct that he could still be given immunity and by either prosecutor or by Congress. And I think that has always been the case.

There has been a long debate as to whether someone with a pardon really can’t claim the privilege against self-incrimination because they have already been pardoned of the crime. But I think that frankly it’s more likely a judge would allow some privileged assertion to be made.

But it really is a moot point because any congressional committee, any prosecutor is likely to immunize this guy and he would then be required to testify.

OLBERMANN: How would you, if you would, connect this with the Libby defense having decided during the trial, during the 11th hour of the trial, not to put Vice President Cheney on the stand in Mr. Libby’s defense?

TURLEY: Well, you know, you and I talked about this when it happened because there was a really incredible sea change. He went and got a very aggressive defense team that made it clear that they were going to do the most predictable thing.

If you ask any criminal defense attorney, they said we would make Dick Cheney the focus of the trial. He is perfect. He’s all over this case. It really was an investigation about what Dick Cheney ordered, what Dick Cheney said, what Dick Cheney did. It’s just that Dick Cheney wasn’t indicted.

So no one was that surprised when the defense team made it clear they were going to call him to the trial and they were going to take the gloves off. And then suddenly, it changed and they said they were not going to call him.

They barely talked about him in any sinister way. And they adopted what could only be described as a passive defense. They virtually walked Libby into a conviction. I don’t mean to be too harsh, but it seemed to me a pretty passive performance.

Well some of us speculated at the time that it seemed to be preserving the chance for a pardon. He was a loyal soldier. He took the hit in court and he remained quiet even after his conviction and even after his sentencing.

OLBERMANN: And to that point, nobody questions the president’s constitutional power of clemency in either a pardon situation or a commutation situation, but when you start commuting the sentences of your own employees, is the mere appearance of a quid pro quo enough to say that this is beyond even a president’s ranks?

TURLEY: Well, it is. All this business of saying he does have an unchallengeable right, that doesn’t mean anything. Just because you have this authority doesn’t mean you can’t abuse it. You’re subject to the view of history and the view of citizens.

And for example, Bill Clinton grossly abused pardon authority when he gave a pardon to his own brother and used the power of his office to benefit his family. And pardoned Marc Rich, that nobody on Earth thought deserved a pardon.

And here, President Bush is really facing the same type of criticism. The interesting thing, Keith, is that he could have taken the high road. This could be a defensible decision if President Bush actually committed other people, but he’s not.

This is a guy who’s saying that I’m really bothered by excessive sentencing when he has been criticized internationally for the excessiveness of punishments and sentencing as a governor, as president.

He is known as someone who pursues the death penalty almost with a blind rapture. And so it fell on rather a lot of suspicious ears when he said I’m doing this because I find 30 months to be excessive.

OBERMANN: Constitutionally, did not the founders foresee this possibility of this? Your own administration’s employee gets the sentence commuted while the administration is still in progress?

TURLEY: Well you know, the framers did talk about the abuse of inherent authority by a president. They were very concerned about the president. They threw over a king and every privilege, every power given to a president was subject to this concern.

But they believed that Congress would check the president and ultimately, there is the power of impeachment. But there have been abuses in history. I am a bit surprised that Bush did not learn from Bill Clinton. You know, Bill Clinton took what was remaining unbesmirched in his term and ruined it in the last few days with his abuse of this power and now I think that the legacy of this presidency has been damaged in the same way.

OLBERMANN: And then there is history. Did Mr. Bush just cement his claim to being the worst president in our history? Andrea Mitchell on the legacy. And a special comment no one is holding their breath on, but frankly, were Mr. Bush and Mr. Cheney true patriots, they would resign. Ahead on the COUNTDOWN.

(COMMERCIAL BREAK)

OLBERMANN: George W. Bush and his critics disagree over when the verdict of history will be delivered on his presidency. He says we will have to wait decades to find out he was right about Iraq. They say no, with 567 days yet to go in his presidency, we already have enough info. No more calls please, we have a winner in the worst president ever competition.

Our No. 2 story in the COUNTDOWN, add now to Iraq and New Orleans, habeas corpus and all the rest, interfering with a court verdict for one of his own staffers. Our chief foreign affairs correspondent Andrea Mitchell now on what is left for this president, if anything.

(BEGIN VIDEOTAPE)

ANDREA MITCHELL, MSNBC CHIEF FOREIGN AFFAIRS CORRESPONDENT

(voice-over): After six years, by all accounts of not asking his father for foreign policy adviser, George W. Bush turned to dad to host this weekend’s Putin summit, an attempt to rescue the rocky relationship with Russia. It was a far cry from the cockiness that marked the president’s reelection.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I earned capital in the campaign, political capital and now I intend to spend it.

MITCHELL: But the devastating reality of the Iraq war has overwhelmed everything else according to administration officials and historians.

ROBERT DALLEX, PRESIDENTIAL HISTORIAN: I think he’s in very serious trouble, not only currently with the public, both with the judgment of future history.

MITCHELL: There have been a string of defeats, from social security to be seen as missing in action on Katrina. He was forced to jettison some trusted advisers while others hang on under fire. The result? Approval ratings at historic lows.

ANDREW KOHUT, PEW RESEARCH CENTER: When we ask people to sum it up in one word that comes to mind when they say George W. Bush, they say “incompetent.”

MITCHELL: Last week, yet another blow: immigration reform.

BUSH: It didn’t work.

MITCHELL: So what is left? Mr. Bush has told visitors he still hopes for a bipartisan agreement on holding foreign terror suspects and conducting electronic surveillance. And he being bombarded with conflicting advice over whether to attack Iran.

But historians he invited in for long talks say he is serene, not agonizing over his legacy.

BUSH: They are still analyzing the presidency of our first president. My attitude is, if they are still analyzing one, 43 does not need to worry about it.

MITCHELL: Andrea Mitchell, NBC News, Washington.

(END VIDEOTAPE)

OLBERMANN: Political capital, don’t spend it all in one place. We segue from politics to keeping tabs with a convenient truth for a politician and TV fan. The “New York Times” reporting that Al Gore received what may have been the only advanced copy of the final episode of “The Sopranos” from Paramount, the studio that distributed his documentary, whose chairman Brad Grey happens to be an executive producer of “The Sopranos.”

Mr. Grey saying he only agreed to part with the copy because Mr. Gore would be airborne to Istanbul when he watched it, when the finale would be showing simultaneously on HBO, therefore he would be unable to divulge its secret ending to the media. Like you’d want to admit you knew.

The copy of the episode came in the kind of lock box, one that Mr. Gore could only get the combination to open after he was in flight. Better yet, when Rudy Giuliani found out about Mr. Gore’s good fortune, he was beyond a jealous, calling his old friend Mr. Grey to ask why he did not also get a sneak peek.

How much money did Mr. Giuliani earn from Paramount last year?

And Tom Cruise is still trying to nail down his latest kerfuffel in German. The German government now making it clear that Cruise is indeed barred from filming scenes for his new movie about Claus von Stauffenburg, the German colonel who tried to assassinate Hitler at a location called the Benderblock where the hero colonel was actually executed. But not because of Cruise’s region, “They will not be permitted to film at the Benderblock, but this has nothing to do with Scientology. We don’t think it would be appropriate to film there,” according to Stefan Olbermann, a spokesman for the German - wait a minute, who is that guy? What was that name?

Dr. Stefan Olbermann of the German Defense Ministry. There aren’t many of us. Anyway, that Olbermann says the government welcomes the film, but not at the site of the execution. And he adds, “Hi, Keith.”

When the guys in charge of the casinos start fixing the roulette wheels so their friends can cheat and never lose, it is time to get you guys to run a casino. A special comment on the resignation, that’s head.

But first, time for COUNTDOWN’s latest list of nominees for the worst person in the world. The bronze to Japanese Prime Minister Shinzo Abe. You can understand why this happened, but still, his defense minister Fumio Kyuma said of the atomic bombs dropped on Hiroshima and Nagasaki in World War II, “I understand that the bombings ended the war and I think that it couldn’t be helped,” unquote, because he said the Japanese were waiting to fight on for years until the last man. Defense Minister Kyuma has now resigned under a storm of protest. You may recall that in January Kyuma said the U.S. invasion of Iraq was a quote, “mistake” based on the false premise that Saddam Hussein had weapons of mass destruction. I think we need this man here.

The runner up, California Congressman and Republican presidential hopeful Duncan Hunter, defending Coultergeist remarks about John Edwards, you know the other “F” word in the assassination fantasies and stuff. He called them articulate, adding, “I think especially because Ann Coulter said nice things about me, I think she is closely approaching that level of being a great American.” A great American what?

But our winner, William Kristol, editor of the right wing publication “The Weekly Standard.” On the “Today Show” this morning, he called Ambassador Wilson’s reaction to the Libby commutation quote “ridiculous” and was then asked if Americans who believe the commutation was a travesty of justice are themselves ridiculous. Kristol answered, “Yes, I do think it’s ridiculous.” Sixty percent of Americans in that poll we quoted to you earlier think Libby should have served his time and the president should have stayed out of it. But according to the editor of the “Weekly Standard” they are “ridiculous.” Which might explain why you have never actually seen anyone buying a copy of the “Weekly Standard.” William Kristol of the “Weekly Standard” and FOX noise, today’s worst person in the world.

I didn’t vote for him, an American once said, but he’s my president and I hope he does a good job. That on this eve of the Fourth of July is the essence of this democracy in 17 words and that is what President Bush threw away yesterday in commuting the sentence of Lewis Scooter Libby.

The man who said those 17 words improbably enough was the actor John Wayne and John Wayne, an ultra-conservative, said them when he learned of the hair’s breath election of John F. Kennedy instead of his personal favorite, Richard Nixon, in 1960.

I didn’t vote for him, but he’s my president and I hope he does a good job. The sentiment was doubtlessly expressed earlier, but there’s something especially appropriate about hearing it now in John Wayne’s voice. The crisp, matter of fact acknowledgement that our form of government has survived even though nearly for two centuries now, our commander in chief has also served simultaneously as the head of one political party and often the scourge of all others.

We as citizens must at some point ignore a president partisanship. Not that we may prosper as a nation, not that we may achieve, not that we may lead the world, but that merely we may function.

But just as essential to the 17 words of John Wayne is an implicit trust, a sacred trust, that the president for whom so many did not vote can in turn suspend his political self long enough and for matters imperative enough, to conduct himself solely for the benefit of the entire republic.

Our generation’s willingness to state we didn’t vote for him, but he’s our president and we hope he does a good job was tested in the crucible of history and far earlier than most, that in circumstances far more tragic and threatening.

And we did that with which history tasked us. We enveloped our president in 2001 and those who did not believe he should have been elected, indeed those who did not believe he had been elected, willingly lowered their voices and assented to the sacred oath of nonpartisanship.

And George W. Bush took our ascent and reconfigured it and honed it and sharpened it to razor sharp points and stabbed this nation in the back with it. Were there any remaining lingering doubt otherwise or any remaining lingering hope, it ended yesterday when Mr. Bush commuted the prison sentence of one of his own staffers, did so even before the appeals process was complete.

Did so despite without as much a courtesy consultation with the Department of Justice. Did so despite what James Madison at the Constitutional Convention said about impeaching any president who pardoned or sheltered those who had committed crimes advised by that president.

Did so without the slightest concern that even the most detached of citizens must look at this chain of events and wonder, to what degree was Mr. Libby told, break the law however you wish, the president will keep you out of prison.

In that moment, Mr. Bush, you broke that fundamental compact between yourself and the majority of this nation’s citizens, the ones who did not cast votes for you. In that moment, Mr. Bush, you seized to be the president of the United States.

In that moment, Mr. Bush, you became merely the president of a rabid and irresponsible corner of the Republican Party and this is too important a time, sir, to have a commander in chief who puts party ahead of nation.

This has been of course the gathering legacy of this administration. Few of its decisions have escaped the stain of politics. The extraordinary Karl Rove has spoken of a permanent Republican majority, as if such a thing or permanent democratic majority, is not antithetical to that upon which rests our country, our history, our revolution, our freedoms.

Yet, our democracy has survived shrewder men than Karl Rove and it has survived the frequent stain of politics upon the fabric of government. But this administration, with ever increasing insistence and almost theocratic zealotry has turned that stain into a massive oil spill.

The protection of the environment is turned over to those of one political party who will financially benefit from the rape of the environment. The protections of the constitution are turned over to those of one political party who believe those protections unnecessary and extravagant and quaint.

The enforcement of the laws is turned over to those of one political party who will swear beforehand that they will not enforce those laws. The choice between war and peace is turned over to those of one political party who stand to gain vast wealth by ensuring that there is never peace, but only war.

And now, when just one cooked book gets corrected by an honest auditor, when just one trampling of the inherent and inviolable fairness of government is rejected by an impartial judge. When just one wild-eyed partisan is stopped by the figure of blind justice.

This president decides that he and not the law must prevail. I accuse you Mr. Bush of lying this country into war. I accuse you of fabricating in the minds of your own people a false, implied link between Saddam Hussein and 9/11. I accuse you of firing the generals who told you that the plans of Iraq were disastrously insufficient. I accuse you of causing in Iraq the needless deaths of over 3,586 of our brothers and sons and sisters and daughters and friends and neighbors.

I accuse you of subverting the constitution, not in some misguided, but sincerely motivated struggle to combat terrorists. But instead, to stifle dissent.

I accuse you of fomenting fear among your people, of creating the very terror you claim to have fought. I accuse you of exploiting that unreasoning fear, the natural fear of your own people who just want to live their lives in peace as a political tool to slander your critics and libel your opponents.

I accuse you of handing part of this republic over to a vice president who is without conscience and letting him running rough shot over it. And I accuse you now, Mr. Bush, of giving through that vice president, carte blanche to Mr. Libby by to help defame Ambassador Joseph Wilson by any means necessary, to lie to grand juries and special counsel in order to protect the mechanisms and the particulars of that defamation with your guarantee that Libby would never see prison.

And in so doing as Ambassador Wilson himself phrased it here last night, of you becoming an accessory to the obstruction of justice.

When President Nixon ordered the firing of Watergate special prosecutor Archibald Cox during the infamous Saturday night massacre on October 20th, 1973, Mr. Cox initially responded tersely and ominously. “Whether ours shall be a government of laws and not of men is now for Congress, and ultimately, the American people.”

President Nixon did not understand how he had crystallized the issue of Watergate for the American people. It has been to that point about the obscure meaning behind an attempt to break into a rival party’s headquarters and the labyrinthine effort to cover up that break in and the related crimes.

But in one night, Nixon transformed it. Watergate instantaneously became a simpler issue. A president overruling the inexorable march of the law, of insisting in a way that resonated viscerally with millions who had not previously understood that he was the law. Not the constitution, not the Congress, not the courts, just him.

Just Mr. Bush as you did yesterday. The twists and turns of Plamegate, your precise and intricate lies that sent us into this bottomless pit of Iraq. Your lies upon the lies to discredit Joe Wilson. Your lies upon the lies upon the lies to throw the sand at the referee of prosecutor Fitzgerald’s analogy.

These are complex and often painful to follow and too much perhaps for the average citizen, but when other citizens render a verdict against your man, Mr. Bush, and then you spit in the faces of those jurors and that judge and the judges yet to hear the appeal, the average citizen understands that sir.

It’s the fixed ball game and the rigged casino and the prearranged lottery all rolled into one and it stinks and they know it.

Nixon’s mistake, the last and most fatal of them, the firing of Archibald Cox was enough to cost him the presidency and in the end, even Richard Nixon could say, he could not put this nation through an impeachment. It was far too late for it to matter then, but as the decades unfold, that single, final gesture of non-partisanship, of acknowledged responsibility not to self, not to party, not to base, but to country echoes loudly into history.

Even Richard Nixon knew it was time to resign. Would that you could say that Mr. Bush and that you could say it for Mr. Cheney. You both crossed the Rubicon yesterday. Which one of you chose the route no longer manners. Which is the ventriloquist and which is the dummy is now irrelevant, but that you have twisted the machinery of our government into nothing more than a tawdry machine of politics is the only fact that remains relevant.

It’s nearly July 4th, Mr. Bush, the commemoration of the moment we Americans decided that rather than live under a king who made up the laws or erased them or ignored them or commuted the sentences of those rightly convicted under them, we would force our independence and regain our sacred freedoms.

We of this time and our leaders in Congress of both parties must now live up to those standards which echo through our history. Pressure, negotiate, impeach, yet you Mr. Bush and Mr. Cheney, two men who are now perilous to our democracy away from its helm.

And for you Mr. Bush and for Mr. Cheney, there is a lesser task. You need merely to achieve a very low threshold indeed. Display just that iota of patriotism which Richard Nixon showed on August 9th, 1974. Resign and give us someone, anyone about whom all of us might yet be able to quote John Wayne and say I didn’t vote for him, but he is my president and I hope he does a good job. Good night and good luck.

END

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Guests: John Dean, Joseph Wilson, Dana Milbank, Paul F. Tompkins

KEITH OLBERMANN, HOST: Which of these stories will you be talking about tomorrow?

The president gives Scooter Libby a get-out-of-jail-free card. Not a pardon, but a commutation of sentence. He has to pay the fine, he has to take the probation. He does not have to serve even one day in prison.

“I respect the jury‘s verdict,” says the president, as he ignores it and ignores the judge‘s rulings, “but I have concluded that the prison sentence given to Mr. Libby is excessive. Therefore, I am commuting the portion of Mr. Libby‘s sentence that required him to spend 30 months in prison.”

How can a president free one of his own former employees? How can a president ignore the courts? How can a president ignore public opinion, even among only those in his own party? And how can he be so gutless as to not even make his announcement on camera?

SEN. PATRICK LEAHY (D), VERMONT: In America, no one is above the law. The president and the vice president are not above the law any more than you and I are.

(END VIDEO CLIP)

OLBERMANN: After the Libby near-pardon, Senator, you might want to rethink that conclusion.

More arrests in Great Britain, and a report that police in Scotland were looking for one of the men connected to those who really didn‘t know how to attack Glasgow airport.

And this is Paris. The backlash against the Hilton story. “US Weekly” becomes us accept her, as our country becomes a nation of laws and not men, unless you used to work for the vice president.

Complete coverage of the president‘s commuting of the Scooter Libby‘s sentence and more, now on COUNTDOWN.

Good evening.

A president who lied us into a war and, in so doing, needlessly killed 3,584 of our family and friends and neighbors, a president whose administration initially tried to destroy the first man to nail that lie, a president whose henchmen then ruined the career of the intelligence asset that was his wife, when intelligence assets were never more essential to the viability of the Republic, a president like that has tonight freed from the prospect of prison the only man ever to come to trial for one of the component felonies in what may be the greatest crime of this young century.

Our fifth story on the COUNTDOWN, President George W. Bush has tonight, by a means of a matter-of-fact prepared statement, commuted the prison sentence of Lewis “Scooter” Libby, former chief of staff to the infamous vice president, Dick Cheney. Ambassador Joseph Wilson and John Dean will join us presently.

Mr. Bush issuing a virtual pardon without having to use that word that once sunk Gerald Ford‘s presidency, leaving intact the $250,000 fine for the former White House aide as well as two years‘ worth of probation, but erasing the 30-month prison sentence, the two and half years a judge determined Mr. Libby must spend behind bars, the startling announcement coming only hours after a federal appeals panel ruled Mr. Libby could not delay his prison term in the CIA leak case that had been expected to start sometime by the end of this summer, in a statement explaining his decision to grant this form of clemency, the president making clear he thinks he is the judicial branch of government as well.

Quoting, “I respect the jury‘s verdict, but I have concluded that the prison sentence given to Mr. Libby is excessive. Therefore, I am commuting the portion of Mr. Libby‘s sentence that required him to spend 30 months in prison. My decision to commute his prison sentence leaves in place a harsh punishment for Mr. Libby. The Constitution gives the president the power of clemency to be used when he deems it to be warranted. It is my judgment that a commutation of the prison term in Mr. Libby‘s case is an appropriate exercise of this power.”

Let‘s turn first to our correspondent David Shuster in Washington.

David, good evening.

DAVID SHUSTER, MSNBC CORRESPONDENT: Good evening, Keith.

OLBERMANN: Many thought something might be coming in this area, but they probably were not expecting this. Would it be accurate to describe the president‘s decision to commute the sentence as a surprise?

SHUSTER: It‘s a surprise in the sense, Keith, that this wasn‘t done, say, on the Fourth of July or on a Friday night. There was every expectation among Scooter Libby‘s supporters that because he had been a good soldier to the vice president, that he had protected Vice President Cheney throughout this case, some would argue that he had muddled things, perhaps, by having no recollection of certain key crucial conversations, there was every expectation that Scooter Libby eventually, once all of his appeals played out, that he would not have to go to prison.

What triggered everything today, of course, was this appellate court, two Republicans on the appellate court who said that, no, there was no close call for Scooter Libby on his appeal, therefore there was no reason to keep him out of prison pending his appeal. So essentially, the clock had started. He had maybe two weeks before he was going to have to report to prison. And so I think the expectation was, the pressure was suddenly on President Bush to deliver to Vice President Cheney‘s top guy.

OLBERMANN: This quarter-of-a-million-dollar fine, David, is it safe to assume that the well-advertised Libby Legal Defense Fund will cover that, and then some?

SHUSTER: Yes, I mean, I‘m not entirely sure whether Scooter Libby will have to pay that out of pocket. But all of his legal fees—and we‘re talking about several million dollars—those are all taken care of.

And when you think about it, Keith, Scooter Libby, with all the context that he‘s had, with the number of people and the number of top Republicans in Washington who have contributed to Scooter Libby‘s defense, who will likely take care of Scooter Libby, Scooter Libby‘s not going to have, according to most analysts in this case, he‘s not going to have much of a financial trouble with his career, even if he‘s not practicing law.

And you would expect, of course, that Vice President Cheney, who has said nothing but nice things about Scooter Libby, that Vice President Cheney will also make sure that Scooter Libby is taken care of, essentially for the rest of his life.

OLBERMANN: Well, if they never give him a dime, they just took care of him big-time today.

The number of statements that are being released in reaction tonight from outraged Democrats, Joe Biden‘s campaign urged Americans to telephone the White House tomorrow, to flood it with phone calls, there are also the Republicans who are pleased as punch, Fred Thompson was one of the first to get a statement out, can we assume that the firestorm about this commutation has only started, it will (INAUDIBLE) echo for weeks, months, maybe years?

SHUSTER: Yes, and the thing that‘s going to fuel some of this is, of course, the wounds from the Clinton impeachment for Democrats are still pretty fresh. And so what Democrats have already started doing is going back and trying to find the Republican senators who voted to convict Bill Clinton on perjury and obstruction of justice.

And Fred Thompson, for example, Keith, he‘s the first victim. And you already Democrats who are calling Fred Thompson a hypocrite for voting to convict, for voting to convict Bill Clinton on obstruction of justice, but now being so happy that Scooter Libby, who was convicted of obstruction of justice, is not going to have to do any time. That‘s the political dilemma for Republicans.

The crucial question is whether Democrats can break this down into its simple terms, the idea that Scooter Libby was convicted by a jury for lying under oath, and that now he is somehow not having to pay the fine, as far as going to prison. If Democrats are able to make that clase—case pretty clearly and concisely, then the politics in this will play out.

But the moment that anybody in this case tries to get into complexities of who leaked whose name when, and whether Scooter Libby was the first leaker or not, I think that‘s where it‘s already bee proven that Americans are going to tune out.

OLBERMANN: The president may have made this a lot more simple than it was as of 12 hours ago. But you‘ve covered this thing from start to finish. You‘ve watched the special prosecutor, Mr. Fitzgerald, as closely as anyone has. Do we have any idea of what his reaction to this is, or can you estimate what his reaction is going to be?

SHUSTER: Keith, I think inside the special counsel‘s office, the U.S. attorney‘s office in Chicago, there‘s already (INAUDIBLE) has sort of been months of surprise that this hadn‘t been done sooner. There was every expectation, according to an aide of Patrick Fitzgerald, that the moment Scooter Libby was convicted, that Scooter Libby was going to get a pardon or a commutation.

There‘s a great deal of surprise, at least, that‘s been building up over the last couple of months. But there was every expectation in Patrick Fitzgerald‘s office that Scooter Libby, despite all of their efforts, and remember, Patrick Fitzgerald was appointed by President Bush as a U.S. attorney and was named by the Bush Justice Department to handle this case, there was every expectation that at the end of the day, Scooter Libby was not going to be serving in prison.

OLBERMANN: MSNBC‘s David Shuster covering the commutation of the Libby sentence in Washington for us. As always, David, great thanks.

OLBERMANN: For more on the historical context of President Bush‘s commutation of the Libby sentence, we‘re fortunate to be joined once again by Richard Nixon White House counsel John Dean, author now of “Worse Than Watergate” and “Conservatives Without Conscience,” and also a contributor to Findlaw.com.

John, good evening.

JOHN DEAN, FORMER NIXON WHITE HOUSE COUNSEL: Good evening, Keith.

OLBERMANN: The Justice Department guidelines say, let me read them exactly, “Requests for commutation generally are not accepted unless and until a person has begun serving that sentence, until all appeals have been exhausted, and that generally, commutation of a sentence is an extraordinary remedy that is rarely granted.” White House admitted tonight Mr. Bush did not consult the Department of Justice in making this decision. If the president did not break the law tonight, did he break the spirit of the law?

DEAN: Well, it‘s certainly in just an internal regulation. It‘s totally within his power to do this. I‘ve been thinking about the historical parallel of this, and it would be like if Richard Nixon, on his way out, or Gerald Ford on his way in, had commuted the sentence of Bob Haldeman, the former chief of staff, who was convicted of perjury and obstruction of justice, or John Ehrlichman, same convictions, or former attorney general John Mitchell. That‘s sort of the parallel.

And that shows the seriousness of it. But Nixon nor Ford was about to touch that.

OLBERMANN: I was going to ask you, history has proved time and time again that Americans don‘t like their president overruling the courts. The point David Shuster just made up—made, made, that just until now, this has been a question of, who leaked what, who lied, who couldn‘t remember, now it becomes a question of interfering with a court‘s ruling. Is that going to simplify this, in fact, for the American public?

DEAN: Well, I think they‘ve been very clever in the way they‘ve spun it. They‘ve said, Well, we think the sentence was excessive, therefore commutation is appropriate. We‘ve not let him off the total hook yet. I say yet, because I think that there‘s a lot of movement still afoot to try to get him a pardon before Bush finally leaves on January 20 of ‘09.

So I—it may not be over yet, Keith, and I think there are a lot of people, it‘s a sort of cutting per the one the way people view politics. I happen to be an independent and kind of look at it right down the middle. And it‘s something of a travesty, actually.

OLBERMANN: In terms of the likely domestic political reaction, John, from that vantage point, is this likely to be judged to being closer to President Ford pardoning Richard Nixon, or what actually happened during the Nixon administration in its waning months, Nixon firing the special prosecutor, Archibald Cox? Is there a way to figure out which path this might go?

DEAN: Well, I think, you know, it‘s going to depend on how the public understands it. And I think if they see it as a disruption of the process, they may act more like what happened with Archibald Cox, where they see the process being cut short. The process had somewhat come to a conclusion. Really hadn‘t started with Nixon. There was no indictment outstanding at that point. In fact, there wasn‘t even a decision within the White House prosecutors—excuse me, the Watergate prosecutor‘s office as to whether they would proceed or not.

but not quite on that level, because I think they‘ve spun it very effectively.

OLBERMANN: Does the special prosecutor, we asked David Shuster about Mr. Fitzgerald‘s reaction to this, does he have anything here to pursue an obstruction of justice investigation on the commutation issue?

DEAN: Well, Keith, he‘s the one who left the cloud over the vice president during the trial. I think he‘s left a cloud over himself if he doesn‘t try to clear that away. There is a very real potential, there‘s an ongoing obstruction of justice going on here, and this was part of the package. And until he satisfies himself that that isn‘t the case, I think there‘s some things to be looked at.

He could very easily put Libby in front of a grand jury and immunize him so he couldn‘t plead the Fifth, and see if he wants to lie again, and go through this again.

OLBERMANN: Could that actually be played out at this point? Could he, could, since there is no recourse here, I presume there is, there‘s no recourse from any further prosecution for Mr. Fitzgerald of Mr. Libby from what exists now. Could he actually do that? Could he immunize him and, as you suggest, bring him in front of a grand jury? Would Libby be able to go to the Fifth? Would he try for some form of executive privilege? Where would we go from there?

DEAN: Well, he could well plead the Fifth, but the prosecutor has the power to immunize him, so he can‘t rely on the Fifth, because he has no jeopardy from his own testimony at that point. Then it would become a question of executive privilege. We know from U.S. versus Nixon that the courts don‘t look very favorably on presidents declaring executive privilege in prosecution matters.

So there‘s not much there. I think that there‘s a good possibility, if Fitzgerald wants to pursue this and wants to remove the cloud, he‘s certainly got a lot of room to move, and probably would do so quickly.

OLBERMANN: Does Congress have any recourse, John?

DEAN: They do indeed. They have the same possibility. They could (INAUDIBLE) so-called use immunity statute they could use. So again, Libby couldn‘t proceed and take the Fifth, but they could indeed try to get to the bottom. They—can Libby claim executive privilege? No. Bush could, but that would only dig him a lot deeper into the hole he‘s already in.

OLBERMANN: We seem to think sometimes that we have been able to estimate how deep that hole is, and that it could not get any further. It sometimes resembles the bottomless pit. But if anybody has lived through and has seen tipping points in political histories of administrations, it‘s you. Is it conceivable that this would be something that would transcend and translate to the American public as one step too far on the part of the president overriding the courts, overriding the Constitution, and in this case, overriding the decision of a jury?

DEAN: Keith, the public‘s very savvy about this kind of issue. This isn‘t a question of who leaked what and why and what the statute said. This is a question of somebody who lied before a grand jury. The American public understands that. The right is trying to spin this that there was no underlying crime. The public gets it, though, that the man lied in front of a grand jury and was prosecuted and found guilty beyond a reasonable of a doubt.

The president has short-circuited that. He‘s tried to say that the sentence was too great. I don‘t think the public‘s going to buy it. So I think we‘ve just heard a little bit of what‘s an ongoing story.

OLBERMANN: Is there, John, any sense that the chance that this president might be impeached grew tonight by virtue of his decision to commute this sentence?

DEAN: I don‘t think, because this is totally within his presidential powers. He has the power of clemency and grace. And the fact that he didn‘t follow procedures is totally within his prerogative to do so. He set up normal procedures for when he wants the—to follow them, but he can always do this. So this isn‘t a high crime and misdemeanor. It is, however, Keith, no question, a political issue that he‘s passing on for the 2008 campaign, as we‘ve already seen.

And I think that the Democrats probably have a very good issue in this.

OLBERMANN: Yes, I think the term “albatross” comes to mind.

The former Nixon White House counsel John Dean. As always, John, great thanks for your perspective and your time tonight.

DEAN: Thank you, Keith.

OLBERMANN: The Libby case, of course, originates with Ambassador Joseph Wilson and the woman whose CIA career was ruined, his wife, Valerie Plame. Ambassador Wilson joins us next.

As the president meets with Mr. Putin of Russia, Mr. Bush‘s boat anchor got stuck in the mud off Maine. Metaphors for a million, Alex. Did the president just hand the White House to the Democrats next year? The political ramifications of today‘s remarkable decision.

OLBERMANN: In Mr. Bush‘s statement this evening, he referred to the immense suffering of Mr. Libby‘s wife and children, and no doubt it was immense.

In our fourth story tonight, the president seems to have forgotten someone else‘s suffering, the victims and her family‘s and their country‘s. Mr. Libby was not convicted of leaking the identity of covert CIA operative Valerie Plame, but he was convicted of obstructing the investigation into who had. She was his victim. Her torpedoed career was a victim, and so too were members of her family. She was targeted in the first place because her husband, former ambassador Joe Wilson, dared expose disingenuous arguments for the war in Iraq.

OLBERMANN: First, can you share the reaction you and your wife had upon hearing this news this evening?

WILSON: Well, on the one hand, there‘s nothing that this administration does that surprises us anymore. It‘s corrupt from top to bottom, and I think most Americans should understand that beyond a reasonable doubt now.

On the other hand, of course, as American citizens, we‘re outraged that the president of the United States would short-circuit the rule of law and the system of justice and really just repudiate everything that we stand for as Americans, including the decision by a jury of Mr. Libby‘s peers, confirmed by the judge in the case, and reconfirmed by the court of appeals.

OLBERMANN: In many quarters, this is going to look like a quid pro quo, that Mr. Libby would have felt free to act as he did throughout this series of events because, perhaps, all along he‘d been promised some sort of get-out-of-jail-free card. Do you place any credence to that theory?

WILSON: Absolutely, absolutely . The president himself acknowledged in his statement today that Mr. Libby was guilty of serious crimes, and then he makes himself an accessory to the obstruction of justice by the mere act of commuting the sentence, so that now Mr. Libby—there is under no incentive whatsoever to tell the truth to the prosecutor, to remove that sand that Fitzgerald said that he threw into his eyes, or to do anything to lift the cloud that Mr. Fitzgerald says continues to exist over the office of the vice president.

OLBERMANN: In a typical case of sentence commuting, a commutation case, the felon is supposed to cooperate with the authorities. No indication that that has happened. Where do we now turn for answers about how this all happened? To Patrick Fitzgerald? To Congress? To your civil suit against Mr. Libby?

WILSON: Well, I would add to all three of those, the necessity for the president now to come clean with the American people. He‘s been hiding behind this notion that he didn‘t want to get involved in an ongoing investigation until now. He has now short-circuited that investigation. He owes the American public some answers.

I would hope that he would instruct the special counsel to release all the information he collected during the course of his investigation, beginning with the president‘s own interview with Mr. Fitzgerald, and the vice president‘s interview with Mr. Fitzgerald.

And if he fails to do that—and I have no expectation that he will, because he is corrupt to the core—I believe that the Congress should begin to investigate this matter.

OLBERMANN: Obviously, the onus of this is going to fall, has fallen today already, on the president. He is the one who ultimately made the decision. He has described himself as The Decider. But as some of your answers so far have suggested, the role of the vice president cannot be underestimated in this.

Do you now, with, when we‘re seemingly at conclusion, although I

suppose Mr. Libby might still be pardoned at the end of the administration

to wipe the record completely clean of what he has done, do you have your -

in your mind a timeline of what happened and what the vice president‘s role was in all of this, including this commutation of sentence?

WILSON: Well, certainly there are people who‘ve been looking at the possible vice president‘s role far more closely than I have. But I would insist, I think, that the vice president come clean on this. And certainly we expect to ask him some very pointed questions on the—in the civil suit. And by the way, people can get information on the civil suit at www.Wilsonsupport.org.

OLBERMANN: Ambassador, your wife‘s identity was considered fair game for this administration to sacrifice for political ends in hopes of ruining your reputation and by doing so, ruining the impact of your criticism of the start of the war in Iraq. It has been reported that she was working on the issue of weapons of mass destruction. And without commenting on anything classified about what her work was specifically, what message does this gesture today send to other CIA operatives about their expandability, their fungibility, within the Bush administration‘s scheme and vision of the world as it stands?

WILSON: Well, let me say this. There‘s a lot of questions about the underlying crime, et cetera, and a lot of this sort of sect of neoconservatives and their acolytes in the American political system who have sort of argued that Mr. Libby didn‘t really commit a crime. But if a government official had spent the morning with the Russian military attache for the express purpose of disclosing the identity of a covert CIA officer, what would Americans call that?

We know in America the difference between right and wrong, even if this administration doesn‘t. And frankly, I think that for the CIA, its covert officers, and for the agents that are recruited by officers, those who would put their lives at risk in order to give us the intelligence we need, will think long and hard about it when they see that an administration with impunity will betray its covert officers, will engage in treason.

OLBERMANN: I would imagine, sir, in conclusion, that many watching this interview share your distress and your anger tonight. Do you have any guidance for your fellow citizens as to how to translate this feeling into some kind of production—productive action at this point?

WILSON: Well, Congress is on leave all week. They will be out in the districts, and I think citizens should make sure they take advantage of every opportunity to meet with their congressmen to share with them that America is a country that is governed by rule of law, and we have a system of justice that has been usurped in what I think is an arbitrary and capricious act by a chief executive who is corrupt to the core and an administration that has demonstrated that it has absolutely no regard for those values that have made this the greatest country on earth for the last 220 years.

OLBERMANN: Joseph C. Wilson IV, our former acting ambassador to Iraq, in the wake of the commutation tonight of the sentence of Lewis “Scooter” Libby. Great thanks once again for some of your time tonight, sir.

WILSON: Thanks very much, Keith. Good to be with you.

OLBERMANN: And earlier in this newshour, we asked David Shuster if he could estimate the reaction of the special prosecutor in this case, Patrick Fitzgerald, the U.S. attorney who was investigating the leaking of the Valerie Plame identity, and the subsequent issues that convicted Mr. Libby of obstruction of justice.

That statement has now come in from the statement of the special counsel, Patrick Fitzgerald, reading, and I‘m quoting directly, “We fully recognize that the Constitution provides that commutation decisions are a matter of presidential prerogative, and we do not comment on the exercise of that prerogative.”

Mr. Fitzgerald continues, “We comment only on the statement in which the president termed the sentence imposed by the judge as, quote, ‘excessive,‘ unquote. The sentence in this case was imposed pursuant to the laws governing sentencings which occur every day throughout this country. In this case,” Mr. Fitzgerald continues, “an experienced federal judge considered extensive argument from the parties and then imposed a sentence consistent with the applicable laws. It is fundamental to the rule of law that all citizens stand before the bar of justice as equals. That principle guided the judge during both the trial and the sentencing. Although the president‘s decision eliminates Mr. Libby‘s sentence of imprisonment,” Mr. Fitzgerald concludes tonight, “Mr. Libby remains convicted by a jury of serious felonies, and we will continue to seek to preserve those convictions through the appeals process.”

Patrick Fitzgerald, the special counsel, in be—what was described as the Plamegate case that resulted in the conviction of Scooter Libby, the trial sentence, the criminal sentence of which has been commuted by the president of the United States today, Mr. Fitzgerald saying that his office “will continue to seek to preserve those convictions” of Mr. Libby “through the appeals process.”

More on this story as it continues to develop. The reaction of special counsel Patrick Fitzgerald.

If it was not before, then the White House is truly tonight in crisis. Apart from the fallout still to come on the Libby commutation, the chairman of the Senate Judiciary Committee now says he may seek a charge of criminal contempt of Congress against the administration. The political forests of George W. Bush have seemingly just caught fire. Dana Milbank will join us.

And new arrests in the failed terror attempts across Great Britain.

COUNTDOWN continues.

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OLBERMANN: Politically speaking, you know you are in trouble when the metaphors start writing riding themselves, metaphorically, that is. Which brings us to our third story on the COUNTDOWN this night, in the commuting this evening of Scooter Libby‘s prison sentence, there is the kind of political and personal favoritism that could sink a popular president. And this president is not popular.

Dana Milbank joins me in a moment to try to assess just how much of his political foot and the party‘s the president just shot off. But it is not as if this is his only problem. Even yesterday, Mr. Bush had failed to free his mired ship of state from the muck and the slime. We mean that literally in this case. He and his father got stuck in their boat, Felicity 3, when the anchor they had dropped refused to pull free, infelicitously.

A Secret Service Pat diver got them out after even the president tried and failed. But no diver in sight on “Meet the Press” yesterday. Senate Judiciary Chairman Pat Leahy was asked about Mr. Bush‘s immobility on the U.S. attorney scandal, the White House refusal to provide testimony or documents. In response, the senator fired a warning shot over the White House bow with his reminder that contempt of Congress can be more than just a way of life, it is also a crime.

(BEGIN VIDEO CLIP)

TIM RUSSERT, “MEET THE PRESS”: Are you prepared to hold the Bush White House, the vice-president, the attorney general and his office under contempt of Congress?

SEN. PAT LEAHY (D), VERMONT: That is something that the whole Congress has to vote on it. In our case, in the Senate, we would have to vote on it. The House, they would have to vote on it.

OLBERMANN: As promised, let‘s bring in Dana Milbank, MSNBC analyst, national political reporter of the “Washington Post.” Dana, good evening.

DANA MILBANK, “THE WASHINGTON POST”: Good evening, Keith.

OLBERMANN: We will talk about what happened with Senator Leahy and that prospect in a moment, but regarding the Libby commutation, how much damage did George Bush do to his presidency tonight?

MILBANK: The question assumes that there is a presidency left to damage. I mean that quite seriously. For most presidents, this would be injurious. But if the president sitting at 25 percent or 28 percent in the polls, and he has already lost all but the hardcore of conservatives, this actually gains him a couple of percentage points. This could be the difference between the 27 and 29 percent presidency.

For the rest of the public, it will only sour their impression further. The only thing he might do to win them back is to have a commutation ceremony, perhaps, like they do for the turkey at Thanksgiving. They could get Scooter on the table in the Rose Garden and then send him off to a petting zoo for a few years.

OLBERMANN: I will make no height joke here. Between this today and the ignoring of the subpoenas from the House and the Senate, on the other side of this, there is an extraordinarily large percentage of those who are in opposition to this administration who do not think impeachment is a good idea or even a rational idea, or at least, did not until today. Do you think this might be impacting on them to some degree, that their opinions of whether or not to seriously consider that issue of impeachment could have been changed by this one action?

MILBANK: Well, it will probably increase the number somewhat. Dennis Kucinich is already up to 10 or 11 House members in his Cheney impeachment petition. But there is a limit to this. It is not so much that the Democrats disagree on the merits, but they disagree on the point of this. If there is 18 months left of the presidency, why raise someone else to the presidency or to the vice presidency?

This president, to put it in perspective, has been down lower longer even than Richard Nixon. It has been two and half years since he has had the support of even half the American public. Two and a half years, incidentally, was the same amount that Libby was supposed to spend in prison. But nobody is talking about commuting the president‘s sentence.

OLBERMANN: Did however—In terms of next year, did he just hang a big albatross around whoever gets the Republican nomination next year, or a big sign that reads, Kick Me, My Party Pardoned Scooter Libby? I mean, Giuliani tonight called this, quote, a reasonable decision and I believe this decision was correct.

MILBANK: You can call it an albatross. I like the turkey thing. But either way, it certainly does. The best hope for the Republicans is that this is still 18 months before the election, that it will be somewhat forgotten by then. So, in that sense, it made sense to get it out of the way politically. But remember, at one of these debates, these candidates, for the most part, went on record saying that they supported commuting or, in fact, pardoning Libby.

OLBERMANN: The timing of a story in your newspaper was pretty much perfect. It was suggesting that the president is fully aware of his image, his rankings in the polls, but is untroubled by any of that . Could whatever follows the Libby decision change that? Because I am sensing at the beginning of this things like Joe Biden saying that all Americans who don‘t agree with this should flood the White House with phone calls tomorrow. That is not your standard Democratic, we‘re not happy with this reaction.

That is a gurgle of anger that has not been heard previously, not even when it came to the subject of the war itself.

MILBANK: True, it‘s hard to imagine that having an affect on the president. What my colleague, Peter Baker, was writing about today was that no matter what goes wrong, he seems to—the president has this sense of serenity, that he is calm or resigned or determined. It is hard to see anything changing this.

We do get signs that something sort of breaking down inside of him. We saw that very awkward statement he made after the immigration legislation failed. He really seemed rattled. But, for the most part, if you think about it, if the unsuccessful war and all the other disasters have not gotten the president off of his serenity, it‘s hard to imagine what else really could.

OLBERMANN: Our own Dana Milbank, national political reporter of the “Washington Post.” As always, great thanks for joining us, Dana.

There‘s more breaking news on this story. We gave you earlier Patrick Fitzgerald‘s reaction to the news of the commutation of the Libby jail sentence. Now one from Senator Hillary Clinton, “today‘s decision is yet another example of this—or that this administration considers itself above the law,” said Senator Clinton.

“This case arose from the administration‘s politicization of national security intelligence and its efforts to punish those who spoke out against its policies. Four years into the Iraq war, Americans are still living with the consequences of this White House‘s efforts to quell dissent,” she says. And ends with, “this commutation sends the clear signal that in this administration, cronyism and ideology trump competence and justice.” The statement of Senator Hillary Clinton tonight.

Also, eight now under arrest for the failed attacks across Great Britain. Were the cops in pursuit of one of them when the vehicle plowed into Glasgow Airport?

And remember Michael Jackson‘s plan for a giant robotic version of him that would wander the desert around Las Vegas? Surprisingly enough, it has not been embraced by the local community. That‘s next. This is COUNTDOWN.

OLBERMANN: Apart from the obvious conclusion that whoever tried to unleash car bombs in England and Scotland really, and fortunately, were not very good at it, comes news tonight, in our number two story, of more arrests, and a report from the British newspaper “The Guardian” that police were on the trail of the Glasgow Airport attackers in the hours before two of them drove into the main entrance and got out and tried to push the burning vehicle inside.

Several hours earlier, police had contacted the agency which had rented a home near the airport to one of the suspects. The news of the additional arrests, and the disturbing number of physicians among them, from our senior investigative correspondent Lisa Myers in London. Lisa, good evening.

LISA MYERS, NBC NEWS INVESTIGATIVE CORRESPONDENT: Keith, western counter-terror officials tell NBC News that two young doctors from Jordan and Iraq are now believe do have been the key players in this plot, a terror cell comprised of at least five doctors.

(BEGIN VIDEOTAPE)

MYERS (voice-over): This is the Iraqi doctor, Bilal Abdullah, being arrested minutes after he and another suspect rammed a flaming Jeep Cherokee into the Glasgow Airport. Abdullah is believed to have worked at the same hospital where this suspect, who set himself on fire and was then hosed down, remains in critical condition.

The other doctor, authorities allege, played a senior role in the plot is this Jordanian, photographed in better days with Jordan‘s Queen Nor. Police arrested 26-year-old Mohammed Asha and his wife on a highway this weekend. At the family home in Amman today, Asha‘s father said his son is no extremist.

MICHAEL SHEEHAN, NBC NEWS TERRORISM ANALYST: The level of education, medical training, and medical profession of the member of this cell is very troubling.

MYERS: Today, two more arrests. Authorities say they were doctors in training at this Scottish hospital. For all their brain power, experts say this cell was, quote, not ready for prime time. Police say the three car bombs were similar and relatively simple, gasoline, gas for barbecue grills, boxes of nails and a cell phone detonator. Yet, two failed to explode.

Authorities were closing in on the cell Saturday when they attacked again, in Scotland, but failed to get over a security barrier at the Glasgow Airport.

CASPIN BLACK, INTELLIGENCE EXPERT: The attack in Glasgow is difficult to explain. It can only be described, if it wasn‘t so horrific, the terms Mickey Mouse would be used about it.

MYERS: So far, none of those in custody fit the usual profile of the terror threat here, young, disillusioned British Muslims. Most, if not all, of those in custody are 20 something Muslims from the Middle East, successful professionals who came to Britain in the last few years.

BLACK: I think it is dangerous if the al Qaeda‘s virus world view is leaching into the highly educated elite.

MYERS: Was al Qaeda directly involved in these attacks? Some experts say their lack of expertise suggest otherwise.

SHEEHAN: They did not have the level of sophistication that an al Qaeda organization would bring to a cell. So, although they are part of the movement, it looks like the operational links were very thin at best.

(END VIDEOTAPE)

MYERS: Tonight, authorities tell NBC that the eighth suspect was arrested outside Britain, and that none of those in custody are talking. Police say still more suspects remain at large, Keith.

OLBERMANN: Lisa Myers in London for us tonight. Great thanks, Lisa. From the latest on terrorism in Great Britain, we make an extraordinary segue to the fantasy world of Las Vegas and a brief look at Keeping Tabs, our nightly round up of celebrity and entertainment news, starting and concluding with the king of pop, as in somebody just burst his bubble.

Michael Jackson is said to be leaving Sin City after planning to relaunch his career there, plans that reportedly included his own casino and a giant statue of him with laser beams piercing the skies over the Vegas strip. The “Las Vegas Review Journal” newspaper says the plans went nowhere, shocking. A Jackson spokesman telling the paper Jackson allowed his lease on a mansion there to expire because of security reasons, not because he is being evicted.

Jackson moved his family, Prince Michael the first, Prince Michael and Prince Michael the second to Las Vegas from Ireland last December. Persistent rumors say they will move back to Europe.

And first she becomes news even though there wasn‘t any news there. Now a tabloid‘s refusal to cover the non-news becomes news itself. That‘s ahead, but first time for COUNTDOWN‘s latest list of nominees for Worst Person in the World.

The bronze to Senator Joe Lieberman of Connecticut. On ABC yesterday, “I hope these terrorist attacks in London wake us up here in America to stop the petty partisan fighting, he said, a partisan gridlock over the question of whether the American government can listen in to conversations or follow e-mail trails of non-American citizens.

Actually, Senator, if you had been paying attention, the NSA spying program included surveillance of American citizens. And you‘re right, it is petty partisan fighting between people who support the United States constitution and people like you.

The silver tonight Sean Hannity of Fox noise, reminding us that the fourth annual Hannity Freedom Concert is coming up in September, an evening of patriotism and inspiration, featuring Hannity, Lee-Ann Rhymes, Lee Greenwood and Oliver North. A flag waving, all American, don‘t tread on me, love it or leave it, god bless the USA occasion, which is sponsored by the Hong Kong Tourism Board.

Our winner by unanimous decision, the 43rd president of the United States who has tonight commuted the sentence of one of the key members of his own administration and has done it gutlessly by press release, who has buried it on the Monday of the longest fourth of July weekend possible, and who has, in so doing, forfeited his claim to being president of anything larger than a small, privileged, elitist, undemocratic, anti-constitutional cabal.

As Oliver Cromwell said to the infamous Rump Parliament in England more than 350 years ago, you have sat too long for any good you have been doing lately. Depart, I say, and let us have done with you. In the name of god, go. George Walker Bush, today‘s Worst Person in the World. As you may have suspected, tomorrow night here on COUNTDOWN, a special comment calling on this vice president and this president to resign. Tomorrow night on COUNTDOWN.

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OLBERMANN: In some parallel universe, Paris Hilton is known for her biting wit and cultural relevance. No one begrudges her notoriety, because she‘s just so dog gone interesting. But in this universe, the Hilton backlash is well underway, even though, just like Miss Hilton, it sometimes looks like posing. Our number one story on the COUNTDOWN, passing on Paris. Hilton fatigue surfacing in the latest issue of “US Weekly.” The magazine cover was devoted to celebrity babies, because goodness knows, that‘s more important.

Any way, that upper left pink stamp promises that its glossy pages will be 100 percent Paris free. And yet, “US Weekly‘s” editor has admitted that part of the reason it was practical, Miss Hilton was being released from jail after the magazine‘s deadline. And unlike “People Magazine,” it had no post-prison interview to flaunt. In other words, Paris Hilton is free, but we are 100 percent Paris free. Nice try.

Which leaves other celebrity newsmakers gasping to fill the void. Thus Britney Spears‘ fight with her mother escalates. Miss Spears reportedly saying, quote, I hope my mom gets the help she needs. Ask the president.

OLBERMANN: You know, it‘s not like “US Weekly” is “Time Magazine” or “Newsweek.” It‘s a celebrity glossy. So they excise all the Hilton news. They replaced it with 12 pages of Hollywood baby pictures. And then what, didn‘t they find themselves scrounging just fill out that issue without mentioning those two words?

TOMPKINS: I know, you almost feel sorry for these people. It‘s got to be a stressful job coming up with celebrity news to put in your magazines. You know, I‘m sure they sit around the office saying, oh, if only Angelina Jolie would murder Jennifer Aniston, or something like that. But if you‘re filling your pages with celebrity baby pictures, keep in mind, these are not baby pictures. These are celebrities‘ babies.

OLBERMANN: What do these babies think of Scooter Libby. There‘s a real sentiment underneath this put on from “US Weekly.” There are obviously people sick and tired of Paris Hilton. Is this because the nation has a habit of creating celebrities who are famous for just being famous, so can then tear them down without cause or consequence.

Or is it because whenever she‘s given the opportunity to speak, she has said absolutely nothing?

TOMPKINS: Yes, it‘s a tricky situation, because, on the one hand, you want to say, wow, even “US Weekly” is saying they‘re tired of Paris Hilton. But on the other hand, this is all their fault in the first place. This is like an arsonist taking a stand and saying, you know what? I‘m not going to stick around and watch the house burn down anymore.

OLBERMANN: Or newscasts doing the same thing. No more Paris Hilton news. A little late. That ship sailed quite a while ago. This is something I found intriguing. Some people with absolutely nothing better to do have taken this Larry King interview with Paris Hilton, played it backwards like the Beatles albums.

There‘s a question about Britney Spears and the answer sounds something like snake, her soul is sick. This is the most interesting thing from that interview, in my opinion. Do you think she gave us any other nuggets backwards?

TOMPKINS: I don‘t know. I haven‘t yet had a chance to queue this up to “The Wizard of Oz.” But, in a way, this whole interview was backwards, because she‘s telling Larry she‘s never drank; she‘s never done drugs. But I think there‘s actually video of her doing such things. So I don‘t know if she‘s got the memento syndrome and she needs to have tattoos in reverse on her body that say, if you can imagine it, I have done it.

OLBERMANN: Lastly then, if we‘re going to replace this Paris Hilton news with something else; Britney Spears hoping her mother gets the help she needs, reportedly angry that her mother sided with Federline over the children. Is this a classic family squabble or is there more to it?

TOMPKINS: Well look, I don‘t care who you are, imagine if you‘re in the middle of an argument and your own mother says to you, you know what? I think Kevin Federline is right.

OLBERMANN: And that sums it up. Comedian Paul F. Tompkins. As always, Paul, great thanks for joining us.

OLBERMANN: That is COUNTDOWN for this the 1,524th day since the declaration of mission accomplished in Iraq. A reminder that tomorrow night here my special comment in the wake of the Libby commutation, urging for the sake of our nation that Vice President Cheney and President Bush resign their offices. I‘m Keith Olbermann, good night and good luck.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

END

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